Day 1 tanker pulls into drop his load Gas Station pays $2.00 a gal
then marks up there price to $2.699 a gal it probably only cost $.69 a gal to make .
2006-06-16 04:54:27 · 6 answers · asked by PaPa Bear 1 in Business & Finance ➔ Corporations
All companies are trying to make profits. Thats why they are not charities. If they can charge more for their product, then they will (and they should).
Your production cost estimates are ridiculous.
Ask your local gas station makes a few cents per gallon profit over what he pays the distributor. The distributor makes a little more per gallon over what he pays. The refiner (is this what you mean by the "oil company") makes a few cents per gallon. The producer (the guy with the oil well) can make a lot or a little or nothing depending on how many of the wells he risks his money in actually produce and how much. The transporters involved all the way down make a little.
If a barrel of crude oil costs $70 then a gallon of crude oil costs $1.67. You can get nearly 1/2 gallon of gasoline from one gallon of crude oil. The rest of the stuff you get is mostly worth less than gasoline (like heating oil or asphalt) so you need about $2.00 back per gallon of gas just to pay for your crude oil.
By the time you put in refining costs and transporting costs and sales costs, the profits shared by the refiner, distributers, and retailers come from gasoline price above $2.50.
Of course, with a crude oil price of $35/barrel, the math is very different and the gasoline price is very different.
2006-06-16 05:38:53 · answer #1 · answered by enginerd 6 · 1⤊ 0⤋
Oil companies do not "rip off Joe Customer" It is simply a function of supply and demand. Why not get upset with the Countries who are selling us the oil? They set the initial price. Also, if the U.S. announced that it was gong to drill for it's own oil in Alaska and was serious enough to start, you just watch the price of oil on the world market drop like a rock. Remember - Supply and Demand. Why not really study what that means?
2006-06-21 11:45:49 · answer #2 · answered by Anonymous · 0⤊ 0⤋
teh oil companies have nothing to do with the price of gas at the pump. the reason gas prices are so high is because during teh ninties no new refining capacity was built. so as demand went up sharply in the years between 2001 and 2006 the supply remained at teh same level. and then...katrina happened and that got all the gas stations freaked cause they knew that they would be without for awhile so they hiked thier prices. also the oil companies don't want to biuld new refinaries because the enviromentalists make it so hard for them to do it.
also if there was no tax on gas it would be between 60 cents to a dollar cheaper. so maybe we need to do somthing about the insane taxes before we attack oil companies
2006-06-16 12:01:36 · answer #3 · answered by emwads 3 · 0⤊ 0⤋
It is about the almighty buck...I think we should all every last one of us boycott driving for one month and see where that leaves the oil companies..
boot lace express??
2006-06-16 12:04:23 · answer #4 · answered by Jafo62 1 · 0⤊ 0⤋
It's called supply and demand (economics).
2006-06-16 12:16:08 · answer #5 · answered by loveangel4ualways2004 2 · 0⤊ 0⤋
Greed...Need I say more?
2006-06-16 11:59:09 · answer #6 · answered by Mrs. Aguilar 2 · 0⤊ 0⤋